3 Artificial Intelligence (AI) Stocks That Can Weather President Trump's Tariff Storm

3 months ago 46

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Keithen Drury, The Motley Fool

Sat, Mar 15, 2025, 11:30 AM 5 min read

The menace of tariffs looms implicit galore companies due to the fact that they marque thing imported much expensive. If that is the lone root for products, past consumers oregon businesses whitethorn clasp retired connected purchasing them to hold retired tariffs successful the anticipation that they volition beryllium reduced.

Furthermore, if products go much costly successful wide owed to tariffs, it could trim user assurance and origin spending to driblet crossed the board.

Many investors are disquieted astir this, which is wherefore the banal marketplace has sold disconnected truthful heavy implicit the past week. However, I deliberation 3 companies tin upwind the tempest caused by President Trump's tariff policies, and each looks similar a beardown bargain pursuing the sell-off.

Many companies could (and apt will) look connected the different broadside of these tariffs conscionable fine, but I'm focusing connected AI hardware suppliers, arsenic these are the companies astir affected by tariffs. Nvidia (NASDAQ: NVDA), Taiwan Semiconductor Manufacturing (NYSE: TSM), and Broadcom (NASDAQ: AVGO) are each important suppliers for AI hyperscalers, and I deliberation they volition beryllium conscionable good amid the tariffs.

The reason? The large AI companies can't unrecorded without the hardware suppliers' products. Nvidia makes graphics processing units (GPUs) that are deployed successful immense quantities to bid AI models and past run them erstwhile deployed.

Its GPUs and the infrastructure that supports them are the champion successful the crippled and person small competition. If you see different competitors, they besides root parts from extracurricular the U.S., truthful they are taxable to the aforesaid fears arsenic Nvidia. With however captious GPUs are to the AI race, the institution volition beryllium conscionable fine.

Broadcom is successful a akin business: It makes connectivity switches and customized AI accelerators (which it calls XPUs), among galore different things, but these 2 merchandise lines successful peculiar are expected to supply monolithic maturation implicit the adjacent fewer years.

Currently, lone 3 companies usage Broadcom's XPUs, and by 2027, this part volition beryllium pursuing a $60 cardinal to $90 cardinal marketplace opportunity. However, 4 much customers are getting their XPUs up and running, which volition adhd to this opportunity. Considering that gross implicit the past 12 months totaled $54 billion, this would beryllium immense growth.

While determination are immoderate fears centered astir tariffs for these two, the propulsion for AI supremacy is overmuch greater. As a result, investors request to look past the abbreviated word and recognize that determination is inactive a ton of semipermanent imaginable with Nvidia and Broadcom.

Taiwan Semiconductor (or TSMC for short) is simply a large supplier for some of these companies. Neither of them tin really manufacture chips, truthful they person to get them from somewhere, and TSMC is the champion enactment disposable for high-end chips.